Utterly pointless -and dangerous.
Unless I'm missing something. All it will do is allow a rotten corporation (Verisign) to make some more money, and give the US unfettered power over the whole Internet, none of which is a good thing (think Arkansas...). It will make it slightly more difficult -but in no way impossible- for a supervillain to take over the internet, but I very much doubt anyone would have tried anyway (see this stone? It repells green tigers. Only $5000 for you, my friend), maybe because no-one would achieve anything by doing so.
No, the internet won't "cease to function". You might have to type IP addresses sometimes, or rely on certificates issued by people or corporations you know, but the "chain of trust" was never really secure anyway, and it never will. Just wait till DNSSEC is broken (should happen roughly 3 hours after it's first deployed).
It looks suspiciously like the weapons of mass destruction thinggy: At long last we're doing something. Against an imaginary threat we just made up. Which gives us full rights for a massive landgrab. Of course. As I said, the chances of some supervillain wanting to take over the root zone are approximately the same as being eaten by a green tiger in the Square Mile, and the chances of said supervillain doing anything with this newfound power would be even slimmer -if you could go any slimmer. And even assuming that, it would be so easily thwarted in a (comparatively) cheap and efficient way using only readily-deployed strategies (one way may be exchanging certificated by IP-based connections between known and trusted peers et voila! "Chain of trust" restored. Admittedly it will be some work for the largest structures, but nothing comparable to DNSSEC deployment IMHO). But of course Verisign wouldn't make gazillions out of it, and the US government wouldn't get the power to exclude the "baddies"* from the domain name system -or just maliciously redirect unsuspecting visitors from a "bad" site to a (CIA/DHS/NSA) scam site harvesting your details. It would be a pity not to use these predator and airborne laser beams to good use, after all. So DNSSEC it is, then. Colour me paranoid, but I'll be far more suspicious about the DNS system *after* than I am now (depending on the way it's implemented. I'm voluntarily considering the worst case scenario here, which is stupid. It won't happen of course. ASBOs were never used against fly tippers, the WMDs actually existed, the Terrorism Act was never user to steal your camera, the anti-paedo laws are never used to prosecute "sexting" minors, ...)
The bright side is that you'll know where to find the really good stuff: if you have to type the IP address, you're on the right track!
Tombstone: it's not El Reg anymore, it's 220.127.116.11. That's what you get for criticizing the "anti-terror" laws!
*that would be China, Iran, Pakistan, North Korea, Europe every other year, Russia, Venezuela, Brazil, Cuba, Chile, two third of Africa, everyone in the Middle East but Israel, any site linking to links to links to links to Simpson porn images (or p2p trackers, or gambling site, or ...) etc. etc...